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Positive Gains 1st Quarter 2008
At Madison Capital Investments, we are very fortunate to be
able to work with a number of fine people and help them transition their
properties, through a 1031 Exchange, into a variety of properties that offer no
daily management. Bill and Sara of Austin, Texas are two such clients.
When Bill and Sara came to us they were owners of ten
properties around the University
of Texas campus. They had
acquired their properties over a period of 25 years, and through a great deal
of effort, had achieved outstanding appreciation with very little debt.
But 25 years of active, daily management had been enough for
them. Bill and Sara had come to a point where they wanted to spend more time
traveling and with their Grandkids.
Since our initial meeting, they have begun selling their
properties, one at a time, and we have successfully transitioned them (through
1031 Exchanges) into a diversified portfolio of TICs and oil and gas assets.
The TICs acquired to date have thus far been Master Lease offerings, which
provide Bill and Sara a fixed monthly income, and their energy investments are
multi-well properties that have been yielding strong returns as well.
Bill and Sara are currently on a two-year plan to sell the
remainder of their initial assets. They are preparing each property, one at a
time, for sale and putting it on the market. This is a reasonable plan for
their lifestyle, as there is no pressure to sell everything at once. It gives
them greater flexibility to pick and choose high-quality replacement properties
for their 1031 Exchange.
At the end of their two-year plan, we are confident that
Bill and Sara will have a sound geographic, and market, diverse portfolio of
income-producing assets that will give them the peace of mind to retire
comfortably – without paying any capital gains.
If they choose to continue using IRS 1031 Exchanges, they
will leave their three children with properties that offer a stepped up basis
and no capital gains.
Thank you Bill and Sara, for the opportunity to serve you.
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